The picket-fence dream still stands, but each generation sees it in a different way. Source: Supplied

AUSTRALIANS have an unusual fixation with home ownership, but this doesn't have to be expressed as outright home ownership.

As long as we are paying off our home, we feel we are participating in the Great Australian Dream.

But it's more than this. The Great Australian Dream is in fact to make money on your house.

Buy a three-bedroom brick-veneer house in some suburbs in 1975 for $40,000 and, with modifications, today it's worth maybe $2 million. Or more.

The old model had Australians buying a house and paying it off a few years out from retirement. The logic today is to buy a house, renovate, put on an extension, sell, buy a bigger house and repeat the whole process "up the property ladder". And all the while - theoretically - building equity.

After all, home equity isn't taxed and it's safe because property values have always increased over the longer term.

But baby boomers in their 50s aren't as fixated with outright home ownership as were their parents, the Depression generation. And the reason is, I think, that deep down boomers believe that their house is their retirement nest egg. If it all gets too much. If the super payout isn't as big as was planned. There's always the option of downsizing.

If this is indeed the lifestyle and retirement strategy of the boomer generation, then they wouldn't necessarily be interested in paying off the mortgage. What they would be interested in is continually trading up, improving property and building equity.

The Great Australian Dream is alive and well. It's just that it has adapted over the years.

To the Depression generation, outright home ownership was everything. To the Depression generation's children, the baby boomers, it's not so much outright ownership as equity improvement.

The former is a defensive strategy; the latter is offensive, since boomers are continually backing their ability to improve property and their ability to remain gainfully employed to fund a mortgage into their 50s and beyond. Same dream, different generation.

Home ownership or part thereof is still part of the Australian DNA.

- Bernard Salt is a KPMG Partner and an adjunct professor at Curtin University Business School.

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